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Rapid adoption of Smartphone and Tablet devices drives increase in ad spend

Rapid adoption of Smartphone and Tablet devices drives increase in ad spend
Friday March 30 2012

Advertisers will more than double mobile paid-search budgets in 2012

The rapid adoption of smart mobile devices, such as the iPhone and the iPad, is changing how consumers interact with search engines, and advertisers are paying attention.

According to a report released today by Marin Software, smartphones and tablets will account for 25% of Google’s US paid search clicks by December 2012, up from 5% in January 2011. A comparison of click through rates show that consumers are far more likely to engage with search engine ads on smart mobile devices compared to desktop computers.

In 2011, paid search clicks from mobile devices on Google increased 132% from January to December. By December 2012, Marin Software projects smart mobile devices will generate 25% of all paid-search clicks on Google as a result of the explosive adoption of smartphones and tablets.

Consumers are much more engaged with search ads on smartphones and tablets as opposed to desktops, as evidenced by click through rates that are respectively 72% and 31% higher.
Search ads on smart mobile devices also have a lower costs-per-click than desktop ads. This difference, in cost coupled with higher click-through rates on mobile, creates favorable performance conditions for advertisers and increased demand for mobile ads.

As a result of these trends, Marin Software estimates large advertisers will more than double their mobile search budgets in 2012, helping Google’s mobile search business grow between 4 and 8 times faster than their desktop business.

“Mobile cuts across all online marketing channels, whether search, display, or social,” said Matt Lawson, Vice President of Marketing and Partnerships at Marin Software. “Much like the desktop market, however, search represents the largest destination for mobile ad budgets. The combination of explosive user adoption of mobile devices, coupled with favorable performance characteristics for ads, makes mobile search an increasingly critical growth opportunity for both advertisers and Google.”